Target Marketing
What are the 3 steps of the target marketing process?
Segmentation → Targeting → Positioning
What are the 4 main types of market segmentation discussed in the chapter?
Demographic, geographic, psychographic and behavioral
What is a target market?
The group of customers a company decides to focus on.
What does “positioning” mean?
How a product/brand is perceived in the minds of customers compared with competitors.
Why do companies divide customers into different segments?
Because customers have different needs, wants and characteristics, and companies can market to them more effectively
A company divides customers by age, income and gender. What type of segmentation is this?
Demographic segmentation
What is a buyer persona?
A fictional representation of a typical customer.
What is a perceptual map used for?
To show where different brands/products are located in consumers minds compared with competitors.
What makes a market segment useful for a company?
If it has specific needs the company can easily satisfy.
Name things psychographic segmentation looks at
activities, interests, opinions, lifestyles and values
Why do marketers create buyer personas?
To step outside their own assumptions and understand the different needs and expectations of their customers.
What is repositioning?
Changing a product's position/image to respond to changes in the marketplace.
What does a company do after it has divided the market into different segments?
It evaluates the segments potential/ attractiveness and decides which ones it wants to target.
A company wants to know how customers actually use its product and how often they use it. Which type of segmentation would be useful?
Behavioral segmentation
What are the four targeting strategies discussed in Chapter 13?
Undifferentiated, differentiated, concentrated and customized marketing.
Chapter 13 uses Charles Schwab as an example of repositioning. What changed about the way Schwab positioned itself?
It moved from being seen mainly as a self-service stock brokerage toward being a broader, full-service financial services firm while still emphasizing relatively low prices
A segment should be something a company can satisfy better than the competition. Why is that important when choosing a target market?
If competitors can satisfy the segment's needs better, there is less reason for customers to choose the company's product.
Chapter 13 talks about the “80/20 rule” when discussing behavioral segmentation. What does the rule mean in this context?
A relatively small group of customers — about 20% — can account for around 80% of a company's sales. These customers can be especially important because of their purchasing and loyalty behavior.
The chapter gives a travel company as an example. Name ONE of its four buyer personas.
Experience Seeker, Chill Out, Family Bonder, or All-Business.
Why could repositioning be beneficial even if a current product is already successful?
Repositioning means changing how customers perceive a product or brand. A company might do it because customer preferences, competitors, or the market have changed and the existing position may no longer be as effective in the future.